Tag Archives: displacement

He wasn’t writing about gentrification but perhaps the sentiment applies.

Many writers are tempted to suggest that examples of gentrification and displacement in certain London neighbourhoods tells us a lot about what is happening throughout London.

For a classic example of this genre see this recent piece in the NewStateman.

A recent piece in The Atlantic makes quite a different argument, claiming that in 22 of the 55 biggest cities in America, including San Diego, Charlotte, Buffalo, Pittsburgh and Detroit, gentrification affected 5 or less percent of all neighbourhoods.

What’s the situation in London? How widespread is gentrification?

Here is a map of London in 2011. Neighbourhoods that are dark red have a higher percentage of residents that work in routine or semi-routine occupations (all data from the census).

Here is a map of London in 2001.

The picture is pretty clear. In large parts of East and West London and parts of North and South London there are lots of neighbourhoods where a large number of people work in routine or semi-routine jobs.

However, in inner London, near the Thames and to the West, there are neighbourhoods in which there are very few residents who work in routine jobs.

In contrast, here is a map of London in 2011. The neighbourhoods that are coloured darker blue are home to a higher percentage of residents that work in senior management positions.

Here is a map of London in 2001.

Again, the picture is pretty clear. In Inner West London and bit of suburbs in the North and South there are neighbourhoods in which there are quite a high percentage of residents who work as senior managers. In large parts of East and West London there are numerous neighbourhoods in which very few residents work in senior management positions.

In both cases, what is striking is not an image of constant change but of continuity.

So what? It’s probably no surprise to anyone that Barking and Dagenham has lots of residents that work in routine jobs and Kensington & Chelsea has lots of senior managers.

A few observations follow;

Even if you believe that attracting new rich residents to your neighbourhood is the best way of regenerating it, ultimately this strategy cannot work for most neighbourhoods in London because there simply aren’t enough rich people to go round.

Gentrification is a curious mixture of the global and the local. International developments such as the march of the knowledge economy interact with specific neighbourhood traits such as transport infrastructure. This probably means that well resourced Local Authorities are best positioned to be the principle public agency that manages the process of gentrification (not national or city government) and to ensure that any wealth created can be shared equally.

Perhaps most importantly, we need strategies of neighbourhood improvement and community development that rely on building on the strengths in working class neighbourhoods since these will always be a large part of London life.

Are there such things as ‘neighbourhood problems’ and can they ever be solved given current levels of income inequality?

A recent report from the Brookings Institute argues that regulation of the housing market is the best way to improve the schooling that poorer children get. They propose that lower income families are supported to live near excellent schools.

This is an interesting and provocative argument. Most discussions on education assumes that individual schools can be improved and that this will help children from low income families. In fact, improved schools are just as likely to lead to increased house prices and low income families being prices out of the neighborhood as middle class families move in. This in turn can lead to the schools continuing to improve since middle class people are better at accessing and using public services, and so the cycle of gentrification and displacement continues.

This same pattern can be seen more broadly in approaches to improving neighbourhoods. Just last week it was announced that the local government wanted to ‘transform’ 6 neighbourhoods in Prince George’s County. Can this possibly work? And by work, I mean, can the grievances of the people who currently live in the neighbourhood by resolved without them being priced out of the neighbourhood? Greivances such as crime, poor quality enviroment, lack of well paying jobs, health hazards and so on.

I had a deeper look at the data on this very question for London. There is information available in London down to the neighbourhood level on; average house prices, the percentage of people from different social grades and the amount of neighbourhood problems (using what is known as the Index of Multiple Deprivation). I found that there are very strong correlations between these different factors.

For example, here is a graph showing the connection between the average house price of a neighbourhood and the percentage of people in that neighbourhood who are in social grades A or B (upper and middle class) using the NRS social grading system.

As you can see, the higher the percentage of people from grades A or B in a neighbourhood the higher the average house price. The correlation coefficient is 0.65 which means there is a strong correlation between these two factors. According to my calculations, in London an extra percentage point of people from grads A or B is associated with an increase in house prices of nearly 11,000 pounds.

The exact opposite is true of the percentage of people from grades D or E (i.e. low skilled or on government benefits). The higher the percentage of people from grades D or E in a given neighbourhood the lower the house price. An extra percentage point of people from grades D or E is associated with a decrease in house prices of nearly 8,000 pounds.

We see a similarly strong relationship when we compare neighbourhood populations with neighbourhood problems. This graph show the relationship between neighbourhood problems and the percentage of people who are in grades A or B.

A larger the percentage of ABs in a given neighbourhood means fewer neighbourhood problems. Inversly, the larger the percentage of DEs in a given neighbourhood the greater the likelihood is that we will find neighbourhood problems. The correlation here is a whopping 0.83.

All this adds up to the fact that, unsurprisingly, areas with higher house prices have fewer neighbourhood problems.

There are some dramatic conclusions that we can draw from this. Imagine a neighbourhood that has mutliple problems and a very fed up population of mostly low skilled workers or people who disabled and unable to work. The neighbourhood has lots of crime, poor quality physical enviroment, a lack of decent jobs and health hazzards galore.

Now imagine that through some miracle a government programme, such as the one mentioned earlier from Prince George’s County, was able to start combating the levels of crime, improving the public realm, getting people healthy and bringing new and good jobs to the area. What would happen?

I would bet that the area would become more attractive, wealthier people would move in, house prices and rents would rise and those same residents that were so fed up with all the old neighbourhood problems would not get a chance to enjoy their improving area. Instead they would be priced out of the area and have to move to another neighbourhood, possibly one that was just as bad as the one they started off in.

What should we do in the face of this problem? I would love to hear your thoughts. Please put them in the comments below and I will return to the problem next week.

The White population of DC is growing, from 217,000 in 2007 to 244,000 in 2010. The black population is declining, from 326,000 to 314,000
Black households usually earn less than White households. More than one in four Black DC residents lived in poverty in 2010 (8.5 percent for non-Hispanic White residents)
Black residents are less likely to be in work than White residents. The unemployment rate for Black DC residents has doubled since 2007, from 10 percent in 2007 to 20.6 percent in third quarter 2011. From 2007 to third quarter 2011, the unemployment rate for White (non-Hispanic) DC residents rose from 1.9 percent to 3.7 percent.
The number of households earning over $75,000 per year has increased, the number of families earning less than $50,000 per year has decreased.

Percentage change between 2000 and 2009

Household incomes

Renters

Homeowners

Overall

Less than $50,000

-24 percent

-32 percent

-26 percent

$50,000 to $75,000

Unchanged

Unchanged

Unchanged

More than $75,000

+81 percent

+58 percent

+63 percent

The number of low cost rental properties has decreased. The stock of low-cost rental stock has shrunk by more than one-third since 2000. The number of rental units with rent and utility costs of $750 or less fell from 69,000 in 2000 to 45,000 in 2007. (all figures are adjusted for inflation to equal 2007 dollars.)

Low-cost homeownership options also shriveled, the number of DC homes valued at $250,000 or less fell from 58,000 to 15,000 between 2000 and 2007.

There is a shortage of housing that people on less than 50% of the Area Median Income can afford.

Certain neighbourhoods are becoming less black and more white.

A growing number of DC households are finding it difficult to afford housing. Nearly 100,000 DC households — or two of five — spent more than 30 percent of their income on housing in 2007 (20,000 more than in 2000)

Four of five DC households with incomes below 30 percent of the Area Median Income (about $28,000 for a family four) spent more than 30% of their income on housing. 62 percent of this group spent half or more of their income on housing in 2007 — up from 50 percent who had housing costs this high in 2000.

In 2009, 24.8 percent of District renter households (34,140 households) had severe housing costs (spending 50 percent or more of their income on housing)

In 2006 the National Low Income Housing Coalition estimated that a full-time worker would have to earn an hourly wage of $24.73 — three and a half times the minimum wage — to afford the rent for a modest two-bedroom house or apartment. The minimum wage is $8.25 per hour in DC. A person making that much would have to work 153 hours a week to afford to rent a two bedroom apartment in the open market.

Funding for all of DC’s major housing programs has been cut in recent years, however, which means that the city is unlikely to have made much progress on the affordable housing problems highlighted in this report. The budget for core housing programs in FY 2010 is $64 million, a nearly 50 percent cut from 2008 and the lowest level since 2004. The Housing Production Trust Fund will receive $18 million in 2010, compared with $62 million in 2008.

The 160 unit Columbia Heights Village development 14th Street and Columbia Road Northwest recently started accepting applicants. It is a project-based Section 8 development that bases tenant rents on their income level. People waited in line for over 4 hours for a chance to put their name down on the list for these properties. One woman in line said

“They are pushing us out! … Average people deserve to live in the city.”

Another said

“I was born and raised here I’m not moving. I will find affordable housing.”